NEW YORK, Aug 16 (Reuters) - Technology shares led Wall Street's advance on Friday as a waning bond rally and news of potential German economic stimulus brought buyers back to the market at the close of a turbulent week.

While all three major U.S. stock averages were sharply higher, they are still on track to post their third straight weekly declines, having been battered since Monday by accelerating U.S.-China trade animosity, simmering geopolitical tensions and signals from the bond market that sparked fears of imminent recession.

Germany's coalition government is willing to suspend its balanced budget rule and take on debt, according to Der Spiegel magazine, raising hopes that Europe's largest economy could steer itself away from recession and cooling worries over a global economic slowdown, for now.

"Germany's willingness to shift away from long-held practices magnifies the fact that the level of economic uncertainty throughout Europe is quite high," said David Carter, chief investment officer at Lenox Wealth Advisors in New York.

"It's a bit like the Fed lowering rates more than expected," Carter added. "Great headline, but further analysis may eventually create uncertainty and weaken markets."

German stimulus hopes helped the benchmark 10-year U.S. Treasury yield rise from three-year lows, closing the book on a fraught week which saw 10-year yields dip below those of two-year notes, a classic recessionary red flag.